Evenly spread out

Construction activity in the city might have taken a temporary dip but the rental rates and sales of apartments are still going strong, finds Anushya Rajagopalan

Fresh residential ventures in the city may have been stalled for the time being but for those who are looking out to buy or rent apartments, there is still plenty of choice. Not in the heart of the city perhaps, but on the outskirts - the favourite destination for builders. With the availability of land within the city reaching a saturation point and new building regulations leading to a reduction in construction activity, demand for apartments sales and re-sales has increased. Again, the spiraling costs and reduced availability of new apartments within the city compels middle class investors and buyers to look to the suburbs. With fewer restrictions, builders are flocking to the suburbs to start new ventures, giving buyers a wider choice at reasonable costs. The demand is therefore spread out and serves to diffuse the pressure from prime areas within the city.

Along with a rise in the number of apartments in and around Cyberabad, A S Rao Nagar or Medchal, the rentals have also had an upward climb.Though the increase in rental values has several reasons, at least some of it can be attributed to the decreasing construction activity in the city and the corresponding demand for apartments. Prem Kumar, MD of Doyen Constructions who is currently doing projects in Srinagar Colony, Mathura Nagar and Basheerbagh says, "After seeing a rise in rentals in the late 90s, followed by a dip, there has been an upward stream in rental values from 2002 onwards. The rise in rentals has been over 20 per cent in the last six to nine months in some areas like Srinagar colony. The building activity going down might be only a part of the reason because the rentals are anyway on a rise due to increasing economic activity." Sudhir Rakhra, MD of Tropical Properties Pvt Ltd however feels that the increase in rentals has been marginal and no abnormality can be found in the trend.

The builders are not complaining. If regulations are stalling their new projects within the city then outside it is booming! Sudhir Rakhra explains, "Development in the outskirts of Hyderabad is really high thats where a lot of new projects are coming up. Even those who are on the look out for apartments prefer the new developed areas to the already concentrated one."

Yes, especially with software hubs shifting to huge campuses away from the hustle and bustle of the city, a majority of employees from outside the city prefer to reside nearby in a quiet environment. Moreover, it is nearly impossible to get a flat in the heart of the city - one there are hardly any empty one left, and two the prices are too high.

For example in Medchal, a 1500 sft apartment is for 20-25 lakhs while in Mehdipatnam nothing is available even close to 35 lakhs. Mohammed Imtiyaz, a real estate agent in Mehdipatnam adds, "There are so many people who are looking out for flats with a budget of 20 lakhs but there are nothing for them. It is best if they look further away in areas like Rajendra Nagar." Prem Kumar adds, "Of late, in Miyapur, the demand for apartments has more than doubled. I feel that there is hardly any choice left for buyers now." While one may wonder about the consequences of the new construction norms in the city and if the supply will ever meet the demand then, builders and real estate agents say that six months down the line will reveal it all

(Source: Times Property)